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To: Petz who wrote (174)7/7/2000 2:08:51 PM
From: AK2004Respond to of 275872
 
John

I do not think that the benefit (if any) would be for anything but the premium. I just think that if the call premium is 5.5% in one year and it is a junk bond that is going to be treated as high rated one then the premium for buy-back would probably be somewhere around 12% unless I am missing something. 12% of 400 mil at 33% tax rate is ~10 cents/share

-Albert

ps 12% is an assumption based on 11% coupon rate, 105.5 call price, 50bp extra from amd and the discount rate of 5.5%.



To: Petz who wrote (174)7/7/2000 6:51:05 PM
From: Bill JacksonRespond to of 275872
 
Petz, That sounds logical. How many people will give up a bird in the hand for a bird in the bush. Will enough people be tempted by the small crumb of a premium to forego the high rate to maturity> I gusee some will because they have better places to park their cash and some will not. ?? knows how many will jump.

Bill


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